Workers compensation insurance price sits between 0.2% and 8% of your total wages, depending mainly on your industry. Most employers sit around 1% to 2% of payroll. On a $300,000 wages bill, that means roughly $900 a year for a low-risk office business and $15,000 or more for a construction business.
WorkCover and workers compensation mean the same thing in everyday use. WorkCover is the name several state schemes trade under, including WorkCover Queensland and WorkCover WA. Whichever term you searched, the pricing works the same way. Your wages bill is multiplied by an industry rate, then adjusted for claims history and your state's rules.
For a full explanation of what the cover does, see upcover's guide to workers compensation insurance in Australia.
At a glance
- Premiums are a percentage of total wages, set by your industry classification.
- Office work sits near 0.2% to 0.5% of payroll. Construction runs 3% to 8%.
- Your premium can change after year-end wage declarations.
- Minimum premiums apply in some states regardless of wages.
- upcover arranges workers compensation insurance for eligible Australian employers.
Why can't you just compare workers compensation quotes?
Workers compensation works differently to your other business covers, and it's worth understanding why before you go looking for a price.
Public liability and professional indemnity are priced by insurers competing for your business, so comparing quotes makes sense. Workers compensation is a compulsory statutory scheme. In most states the regulator sets or approves the rate that applies to your industry classification.
The practical implication: the lever usually isn't shopping around. It's getting your classification code right and managing your claims experience.
Who do you actually deal with?
That depends on your state, and the scheme names vary enough to be confusing.
- New South Wales: icare, with premiums calculated under SIRA's rules.
- Victoria: WorkSafe Victoria, arranged through an authorised agent.
- Queensland: WorkCover Queensland.
- South Australia: ReturnToWorkSA.
- Western Australia, ACT, Tasmania and Northern Territory: approved private insurers, operating within a regulated framework.
In the first four, you're dealing with the scheme itself and much of the price is set before any insurer or broker is involved. What varies is your wages declaration, your classification code and your claims history.
In the last four, insurers compete within regulated bounds. There's more variation between providers, which is where comparing cover and talking to a broker can make a practical difference.
How much is workers compensation insurance calculated on?
The basic calculation follows this formula:
Total annual wages x industry classification rate +/- claims history adjustment = estimated premium
For example, a retail business paying $400,000 in annual wages with an industry rate of 1.5% and no claims adjustment would pay an estimated premium of $6,000 per year. A construction business with the same wages at 5% would pay $20,000.
Each part of the formula works like this.
Payroll size
Premium starts with total wages for the year. That includes salaries, overtime, superannuation, bonuses, commissions and some allowances.
Work type classification
Your business is assigned a classification code based on its primary activity. Higher-risk work attracts a higher rate. A bookkeeper and a scaffolder are in different risk categories, and their rates reflect that.
Claims history
Claims frequency and cost can affect pricing, particularly in experience-rated schemes. Employers with fewer claims and strong return-to-work outcomes may face less premium pressure over time, depending on the scheme. Early injury reporting, safe work practices and structured return-to-work support can help at renewal.
State or territory scheme
Where your workers are based determines which scheme applies. The same business operating in Queensland and South Australia would pay different base rates. If you employ workers in more than one state, you may need policies in each jurisdiction.
How much does workers compensation cost per employee?
How much does WorkCover cost per employee is a common question. The honest answer is that premiums are calculated on your total wages bill rather than per head. It's still useful to work out the per-employee figure for budgeting.
Take your industry rate and apply it to one employee's wages. Worked from the industry rates below, on a $70,000 salary:
- Office and professional work at 0.2% to 0.5%: roughly $140 to $350 per employee per year.
- Retail and hospitality at 1% to 2%: roughly $700 to $1,400 per employee.
- Transport and logistics at 2% to 5%: roughly $1,400 to $3,500 per employee.
- Construction and trades at 3% to 8%: roughly $2,100 to $5,600 per employee.
Two caveats. Adding an employee doesn't always increase your premium proportionally, because some schemes apply minimum premiums and others adjust rates as payroll grows. And the wages figure covers more than base salary.
Is there a workers compensation insurance cost calculator?
You can get close without one. The formula most schemes use is straightforward:
Total annual wages x industry classification rate = base premium
Three steps:
- Add up your total wages. Use the same categories as above, and check which allowances your scheme counts.
- Find your industry rate. Your state scheme publishes rates by classification code. WorkCover WA publishes recommended rates by industry class, and SIRA publishes the NSW classification rates.
- Multiply, then adjust. Apply your claims history if you're in an experience-rated scheme, and check whether a minimum premium applies.
What a manual estimate won't capture is your specific classification code, any experience rating applied to your account, or scheme-specific loadings and discounts. For those you need a quote based on your actual business details.
How much does workers compensation cost by industry?
For a business with $300,000 in annual wages, here is what the cost may look like across different risk levels.
Office-based work
Accounting, IT consulting, legal services, financial planning, administration. Rates typically sit around 0.2% to 0.5% of payroll. Estimated cost: roughly $600 to $1,500 per year.
Retail and hospitality
Shop assistants, cafe and restaurant staff, hotel workers. Rates typically sit around 1% to 2%. Estimated cost: roughly $3,000 to $6,000 per year.
Construction and trades
Builders, electricians, plumbers, concreters, roofers, scaffolders. Rates can sit between 3% and 8%, sometimes higher for demolition or heavy earthworks. Estimated cost: roughly $9,000 to $24,000 per year.
Transport and logistics
Couriers, truck drivers, delivery drivers, warehouse workers. Rates typically sit around 2% to 5%. Estimated cost: roughly $6,000 to $15,000 per year.
These examples are indicative only. Actual premiums depend on your state scheme, specific industry code, wages, claims history and insurer or scheme rules.
Some states apply minimum annual premiums regardless of payroll. For example, NSW has published a minimum of $240 and South Australia has published a minimum of $200. Check the relevant state scheme for current figures.
Want a figure based on your wages, industry and state? Start with upcover's workers compensation insurance page.
How much does WorkCover cost in each state?
Each state sets or regulates its own average premium rate. These change periodically and individual employer premiums vary based on business and risk factors.
New South Wales
NSW has frozen premium rates at 2025-26 levels for the 2026-27 and 2027-28 policy years, according to SIRA. Individual premiums can still change with wages, business activity and claims experience.
Victoria
The Victorian Government confirmed the average WorkCover premium rate remains at 1.8% for 2025-26. Individual employer premiums vary by business and risk factors.
Queensland
WorkCover Queensland has maintained one of the lowest average rates in Australia, at around 1.34%.
South Australia
ReturnToWorkSA confirmed the average premium rate for 2025-26 is maintained at 1.85%.
Western Australia
WorkCover WA publishes recommended rates by industry class for 2025-26. Final pricing varies between approved insurers.
Tasmania, ACT and Northern Territory
Insurer-set or suggested rates, so pricing varies by industry, insurer and claims history. Worth comparing.
For national context, Safe Work Australia reported a standardised average premium rate of 1.34% of payroll in 2021-22. The state figures above are more current and more relevant to what you'll actually pay.
Why is your premium higher or lower than average?
Your industry classification and claims history do most of the work, and both are covered above. Three other things move your number in ways employers often miss:
- Contractors and deemed workers. Some contractors may need to be included in wage declarations depending on state rules, which increases the wages base your premium is calculated from.
- Wage estimate accuracy. Your first premium is based on estimated wages. If actual wages are higher at year-end you may receive an adjustment invoice. If lower, a refund or credit.
- Return-to-work outcomes. Getting injured workers back to suitable duties earlier shortens claims. In experience-rated schemes that can ease premium pressure over time.
What information do you need for a workers compensation quote?
To get a quote, you generally need:
- ABN and business name
- State or territory where workers are based
- Number of workers
- Estimated annual wages
- Industry or work type
- Business locations
- Claims history
- Whether you use contractors
- Preferred start date
Having these details ready makes the quoting process faster. If you employ workers in more than one state, you may need quotes for each jurisdiction.
How upcover can help
Where a broker adds value depends on your state, for the reasons above.
Western Australia, ACT, Tasmania and Northern Territory. Approved insurers compete within a regulated framework, so comparing cover and pricing genuinely matters. upcover arranges workers compensation insurance for eligible employers in these jurisdictions.
New South Wales, Victoria, Queensland and South Australia. The rate is largely set by the scheme, so the value isn't in shopping around. It's in getting your classification code right, declaring wages accurately, and managing claims experience. Getting the classification wrong is one of the more common and more expensive mistakes employers make.
- 70,000+ businesses covered across Australia.
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For related guides, see workers compensation insurance in Australia, is workers compensation compulsory and employers liability insurance.
upcover Pty Ltd ABN 17 628 197 437 is a Corporate Authorised Representative (CAR 1299211) of Experience Insurance Services Pty Ltd ABN 41 657 596 506, AFSL 539078.
Frequently asked questions
How much does WorkCover insurance cost?
WorkCover insurance cost is the same thing as workers compensation cost, since WorkCover is the trading name several state schemes use. Expect 0.2% to 8% of your wages bill depending on industry, with most employers around 1% to 2%. Queensland's average sits near 1.34%, Victoria at 1.8% and South Australia at 1.85% for 2025-26.
How are workers compensation premiums calculated?
Premiums are based on estimated wages multiplied by your industry classification rate, then adjusted for claims history and state scheme rules.
What is the average workers compensation rate in Australia?
Published average rates vary by state. Victoria has confirmed 1.8% for 2025-26 and South Australia 1.85% for 2025-26, while Queensland sits near 1.34%. Safe Work Australia reported a national standardised average of 1.34% of payroll in 2021-22. Actual rates depend on your industry and claims history.
Why does workers compensation cost more in some industries?
Higher-risk industries have more frequent or more severe workplace injuries. Construction, transport and manufacturing typically attract higher rates than office-based or professional services work.
Does claims history affect my workers compensation cost?
Yes. In many schemes, employers with fewer and less costly claims generally pay lower premiums over time. For medium and large businesses, experience rating compares your claims performance against your industry average.
Do contractors affect my workers compensation premium?
Some contractors may be treated as workers depending on state rules and the nature of the engagement. If a contractor is deemed a worker, their wages may need to be included in your declaration, which increases the wages base your premium is calculated from.
The information in this article is general in nature and provided for informational purposes only. It does not constitute personal insurance, legal, employment, tax or business advice. Workers compensation rates, premiums and calculation methods vary by state and territory and can change. Rate data is sourced from published state scheme information, Safe Work Australia and official government announcements for 2021-2026. Actual premiums depend on your state, industry code, wages, claims history and insurer. Always confirm current rates with the relevant state or territory authority or insurer. All insurance products arranged through upcover are subject to the terms, conditions, limits and exclusions contained in the relevant policy wording and Product Disclosure Statement. Before deciding whether a particular insurance product is right for you, please read the relevant PDS and consider your personal circumstances. upcover Pty Ltd ABN 17 628 197 437 is a Corporate Authorised Representative (CAR 1299211) of Experience Insurance Services Pty Ltd ABN 41 657 596 506, AFSL 539078. upcover arranges insurance products with selected insurers and underwriters and does not compare all general insurers or insurance products available in the market.
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